India lowers EV import duties to 15%, paving the way for Tesla’s entry. The policy requires local investment and manufacturing within three years…Read ahead

Tata and Mahindra have helped electric vehicles grow in India. They have made EVs more common by offering good quality models. Now, the Indian government is making big changes to welcome global EV brands.

Tesla’s India Entry: A Big Move

Prime Minister Narendra Modi recently met Elon Musk, the CEO of Tesla, during his visit to the USA. Since then, news about Tesla entering India has been spreading fast. The Government of India has changed its EV import rules to attract Tesla and other global brands. These changes will create new business opportunities in India.

New EV Import Policy in India

The Government of India also reduced import duties on electric vehicles. The current import duty for premium electric cars priced above $35,000 is just 15% from 110%. This move will help global car brands sell EVs in India at better prices. To qualify, a company must:

Invest at least ₹4,150 crore ($500 million) in India.
Reach a minimum turnover of ₹2,500 crore by the second year.
Apply for the policy within 120 days.
Set up operations in existing factories.

The policy does not consider past investments by companies. Approved companies can import 8,000 EVs per year at a 15% tariff. These vehicles must cost at least $35,000.

Manufacturing and Local Production Rules

Companies using this policy must set up manufacturing facilities in India within three years. They must also ensure:

25% local value addition within three years.
50% local value addition within five years.

Turnover Targets for EV Companies

The Indian government has set progressive revenue goals for EV brands:

₹2,500 crore by year 2.
₹5,000 crore by year 4.
₹7,500 crore by year 5.

Official approval letters for this policy may be issued by July-August 2024. Once approved, EV imports will begin soon after.

Tesla’s Plan for India

After meeting PM Modi, Elon Musk is keen to bring Tesla to India. Reports suggest that Tesla will launch a new EV priced at ₹21 lakh. This car will compete with Tata, Mahindra, and MG models.

Tesla has already started hiring employees in India. The company may set up manufacturing plants in Mumbai and Delhi. Initially, Tesla will focus on sales in Mumbai, Delhi, and Bangalore.

Conclusion

India’s new EV import policy is set to boost electric vehicle adoption. Lower import duties will help Tesla and other brands enter the market. The government’s focus on local production will also create jobs and drive economic growth.

Tesla’s arrival will bring more EV choices for Indian consumers, making electric cars more popular than ever.